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Strategies & Market Trends : Market Gems:Stocks w/Strong Earnings and High Tech. Rank -- Ignore unavailable to you. Want to Upgrade?

To: Susan G who wrote (98251)	5/18/2000 11:49:00 AM
From: Lane Hall-Witt	Read Replies (1) \| Respond to of 120523

Susan G -- CSCO: Ouch! That's a tough choice. You might at least wait through options expiration to see if they're just guiding it in to kill the 55s. But I've got to tell you, I am pretty bearish on the Nasdaq at this point and think the big guns have to give up some ground before we can rebuild. The talking heads keep saying that Tuesday's Fed action was no problem, that we were all expecting the 50 points. But I don't think the market really was expecting 50 on Fed funds, 50 on the discount, and a very hawkish forward statement; I still feel the market has to price in some additional Fed hawkishness. The summer doldrums is also a real phenomenon, despite the talking heads who've been trying to sucker us individuals into the Naz by saying the doldrums theory is a bunch of hooey. Personally, from an investment perspective (as opposed to a trading perspective), I've long been worried about CSCO's valuation and think it eventually will suffer through a "re-valuation" process that will trim its multiple. I unloaded my investment holdings over the winter because I just couldn't see how much long-term upside a $500 billion company with a triple-digit P/E could have. It's really a tough call, though, because CSCO obviously is a fantastic company and is a Street favorite that could bounce back any time the big money decides to move it. From a trading perspective, I don't know if 55 is the best exit point. I wouldn't be surprised to see CSCO pop back into the 60s here soon, after we cycle through these lows. But I'm not holding out much hope for sustained strength in techs until the summer doldrums are behind us. Maybe Jenna, OJ, Lee, or some of the other chart folks can help out in planning an exit strategy for CSCO, if you're seriously thinking of selling it--. All IMHO only, of course!